Note 3 - Notes Payable

6 Months Ended

Jun. 30, 2017

Notes to Financial Statements

Debt Disclosure [Text Block]

3 .   NOTES PAYABLE

The Company

’s term note is payable in monthly installments of

$212,468.

Borrowings under the term note bear interest at an annual rate of

3.12%.

The outstanding balance of the term note at

June 30, 2017

was

$2.1

million.

T

he Company also has a revolving credit note which was amended and extended effective

June 30, 2017

with a maturity date of

June 30, 2018.

The maximum aggregate amount available under the revolving credit note is

$12.0

million. Borrowings under the revolving credit note bear interest at a variable annual rate, with

three

rate options at the discretion of management as follows: (

1

)

2.1%

plus the

one

-month London Interbank Offered Rate (“LIBOR”) or (

2

)

2.1%

plus the

one

-,

two

- or

three

- month LIBOR rate, or (

3

) the bank’s

one

-, two, three, six, or

twelve

month Money Market Loan Rate. As of

June 30, 2017

the revolving credit note did

not

have a balance and the Company had the capacity to borrow

$12.0

million.

The term note and revolving credit note are secured by certain of the Company

’s assets, including the Company’s land, building, trade accounts receivable and intangible assets. The term note and revolving credit note contain various restrictions and covenants applicable to the Company, including requirements that the Company maintain certain financial ratios at prescribed levels and restrictions on the ability of the Company to consolidate or merge, create liens, incur additional indebtedness or dispose of assets. As of

June 30, 2017,

the Company was in compliance with its financial covenants.